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What is Gift Aid?

Gift Aid is a scheme that enables registered charities to reclaim tax on a donation made by a UK taxpayer, as a result raising the donation amount by 25p per each pound given without costing the donor any extra.

Claiming criteria

Only recognised charities or community amateur sports clubs can claim gift Aid.

Gift Aid can be claimed on donations from individuals providing that the donor has:

  • Made a Gift Aid declaration giving the permission for it to be claimed.
  • Earned the same amount or more in Income tax or Capital Gains tax during that tax year.

There are certain donations that Gift Aid cannot be claimed on, some examples being:

  • payments for goods and services.
  • gifts that come with repayment conditions.
  • Donations of money from a company.

Read more information on what can or can not be claimed on can be found here

How to donate

A charity cannot claim the tax back unless they have a completed Gift Aid declaration (usually a form).  A declaration form must be completed for each charity. 

The donations will qualify providing the donor has paid at least the same amount in Income Tax or Capital Gains Tax during the tax year being claimed for.

If you are a Higher rate taxpayer you may be able to claim back the difference between the rate you pay and the basic rate on the donation.

If you have any questions on this or another accountancy topic then contact AJR & Co Ltd to arrange a free 30 minute consultation